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The ultimate guide to ECO4

The Sparkway Team

Colorful UK terraced homes
June 5, 2023

ECO4 is a government-funded scheme aimed at enhancing energy efficiency in UK homes and addressing fuel poverty. Learn more in this comprehensive guide.

Since its inception in 2013, over 3.1 million home improvements have been carried out under the scheme, and ECO4 – the fourth phase of the Energy Company Obligation (ECO) – seeks to build upon this success.

In this comprehensive guide, we will explore the key aspects of ECO4, including its scope, eligibility criteria, and application process.

What is the ECO4 grant?

ECO4 represents the fourth stage of the government's Energy Company Obligation (ECO) scheme. As part of its Sustainable Warmth Strategy, the government has extended the ECO grant for an additional four years, ensuring its operation until March 2026.

The ECO4 scheme serves a crucial mission - to empower low-income households that otherwise may struggle to modernise their homes and heating systems. This initiative not only brings warmth to those most in need but also actively contributes to the national ambition of achieving net zero emissions by 2050. It's a win for both individuals and the environment.

Remember, the ECO4 scheme is primarily aimed at those in low-income households. It's also geared towards homes that are least energy-efficient. If you don't meet these criteria, it may be worth exploring other schemes or grants that could help you improve your home's energy efficiency.

How is ECO4 different from ECO3?

While ECO4 shares many similarities with the previous ECO3 phase, it seeks to reach an even larger number of people during its final stage. Moreover, the eligibility criteria for ECO4 have been modified to extend assistance to low-income families who do not receive benefits. The ECO4 report highlights that 46.1% of fuel-poor households do not receive benefits. To address this, the government plans to "expand and reform local authority flexibility, so that suppliers can deliver up to 50% of their obligation via that route."

Concurrently, certain benefits available under ECO3 have been removed to better target households with lower incomes. Non-means-tested benefits such as Disability Living Allowance (DLA), Personal Independence Payment (PIP), and Attendance Allowance are no longer offered under ECO4.

What does ECO4 cover?

The range of home improvements covered by ECO4 varies depending on the chosen energy supplier. To provide an overview of the support available through the ECO4 grant, let's explore some key areas of interest:

Insulating homes:

ECO4 adopts a fabric-first approach, prioritizing improvements to the building envelope before focusing on heating systems. Homes with an energy efficiency rating of 'D' or below are required to install loft, roof, and exterior-facing cavity wall insulation before making any enhancements to existing heating systems. Solid wall insulation is a specific focus, with the aim of completing 22,000 installations annually.

Repairing boilers:

The scheme incentivizes the repair of efficient gas boilers whenever possible to promote waste reduction. In cases where heating systems are beyond repair, the Broken Heating Cap allows for their replacement.

Installing greener heating systems:

ECO4 emphasizes the replacement of outdated boilers with more environmentally friendly alternatives. Coal-fueled heating systems were already excluded under ECO3, and ECO4 continues this restriction by adding oil- and LPG-fueled heating systems to the exclusion list. Instead, the government encourages the adoption of heat pumps and biomass boilers as greener alternatives. Additionally, solar photovoltaic (PV) installations will continue in electrically heated homes, provided that biomass or District Heat Network options have been ruled out.

Who is eligible for ECO4?

ECO4 aims to assist the least energy-efficient homes in the UK, with a specific focus on low-income and vulnerable households. Eligibility for the ECO4 scheme is determined based on various factors, including benefit status. Applicants who receive any of the following benefits are typically considered eligible:

  • Income-based Jobseeker's Allowance (JSA)
  • Income-related Employment and Support Allowance (ESA)
  • Income Support (IS)
  • Pension Credit Guarantee
  • Working Tax Credit (WTC)
  • Child Tax Credits (CTC)
  • Universal Credit (UC)
  • Housing Benefit
  • Pension Credit Savings Credit

Furthermore, individuals receiving additional Department of Work and Pension (DWP) benefits are also granted access to ECO4, regardless of their Universal Credit status.

While the scheme primarily focuses on owner-occupied homes, this phase of the grant also extends support to inefficient social housing and private rented housing, subject to the landlord's approval.

How to apply for ECO4

If you believe you qualify for ECO4, the next step is to contact one of the energy suppliers offering the scheme. They will guide you through the application process, which typically involves a telephone assessment. During this assessment, you will be asked questions about your income, benefit status, and your property's energy efficiency rating.

Following the telephone assessment, an installer will arrange a visit to your home to assess its suitability for the grant and confirm the available improvements.

Which energy companies offer ECO?

All gas and electricity companies with more than 150,000 customers are obligated to provide ECO measures. The current list of energy suppliers participating in the scheme includes British Gas, E.ON, Ecotricity, EDF, ESB Energy, Octopus Energy, Outfox The Market, OVO Energy, Scottish Power, Shell Energy, SO Energy, The Co-Operative Energy, The Utility Warehouse, and Utilita Energy.

It's worth noting that you are not limited to approaching your current energy supplier for ECO4. You have the flexibility to choose the company that best suits your needs and preferences.

To get in touch with any of these energy companies regarding the ECO scheme, you can find their contact details on the Ofgem website.

Summary

The ECO4 scheme plays a crucial role in improving energy efficiency and addressing fuel poverty in the UK. By extending the scheme for an additional four years, the government aims to provide support to vulnerable individuals during these challenging times. However, public opinion remains divided, with our 2023 National Home Energy Survey indicating that 76% of Brits believe the government has not done enough to alleviate the burden of energy bills.

If you believe you meet the eligibility criteria for ECO4, don't hesitate to reach out to one of the participating energy suppliers. They will guide you through the application process and help you access the benefits of the scheme.

Ready to transform your home's energy efficiency?